Swiss Franc: Further losses seem capped against US Dollar – UOB

UOB’s Quek Ser Leang and Lee Sue Ann note that USD/CHF has surged over the past two days, with strong momentum pointing to further Dollar strength. However, they stress that deeply overbought conditions are likely to cap upside to the 0.8305–0.8330 area. Short-term support is highlighted at 0.8270 and 0.8255, while the broader rebound is seen lacking momentum to revisit the July peak.

Upside seen limited by resistance

"24-HOUR VIEW: USD rose sharply over the past two days, reaching a high of 0.8296 yesterday. Strong momentum points to further USD strength, but given the deeply overbought conditions, this could limit any gains to a test of 0.8305. Support is at 0.8270; a breach of 0.8255 would indicate that the immediate upward pressure has eased."

"1-3 WEEKS VIEW: TWe revised our view from positive to neutral on Tuesday (22 Sep, spot at 0.8210), indicating that USD “is likely to trade in a range between 0.8155 and 0.8255.” USD broke above 0.8255 two days ago, and yesterday, it rose further and reached a high of 0.8296. While the renewed upward momentum suggests USD could rise further, deeply overbought conditions point to relatively limited upside, likely a test of 0.8330. The upside risk will remain intact as long as USD holds above 0.8225 (‘strong support’ level)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)